PSA收購歐寶，對中國意味著什麼

GM made quick work of its disposal of long-time loss making unit Opel (and Vauxhall) along with its European financing arm, selling them to French carmaker PSA Group in a deal worth €2.2 billion, less than a month after talks reportedly began between the two companies.

The official announcement on March 6 means the global auto industry has witnessed yet another mega merger and acquisition deal among two major OEMs, just a few months after Nissan acquired a 34 percent stake in Mitsubishi Motors.

With the acquisition of Opel/Vauxhall, PSA becomes the second largest carmaker in Europe after Volkswagen Group, surpassing the Renault-Nissan Alliance with more than 1 million units in added production and a 16.5 percent market share in 2016 adding Opel/Vauxhall』s volumes.

GM, on the other hand, is now much leaner as CEO Mary Barra continues to reshape a company that is now focused on profitability and mobility rather than volume. In fact, with Opel gone, GM will likely give up its No. 3 position in global auto sales rankings this year to the now Renault-Nissan-Mitsubishi Alliance, which came just a few thousand units short of beating GM last year. The job of turning around Opel, which has lost more than €20 billion in Europe since 1999, is now at the hands of PSA chief executive Carlos Tavares, who came over from Nissan in 2014 to steer a PSA ship that almost sank at the time but survived thanks to a state-backed bailout and rescue from Chinese partner Dongfeng Motor, who injected €800 million into PSA that year for a 14-percent stake.

That means the deal has quite a lot of ramifications for both PSA and GM in China. Could PSA bring Opel, which exited China in 2015, back into the country through its existing joint venture with Dongfeng or even with Chang』an? Can GM sustain its future product pipeline in China for the Buick brand, which has depended on Opel』s R&D prowess in the past?

The answer to the first question is yes, theoretically. PSA revealed in a analyst conference call after the deal announcement that it would be free to use the Opel brand globally as long as the cars used exclusive PSA technology. There are no specific terms in the deal that bars PSA from using the Opel brand outside Germany so the prospect of Opel returning to China via the form of a Dongfeng-Opel division within Dongfeng-PSA is not impossible, given Chinese consumers』 appetite for German brands. PSA also has the Chang』an-PSA JV at its disposal if localization of Opel is warranted.

However, the priority for PSA at this point in time and at least for the next two years is how to return Opel to profitability as it has promised. And in China, PSA faces a daunting task of reversing a serious sales downfall of its Citroën, Peugeot and DS brands which have lost luster against their foreign counterparts and rising popularity and strength of Chinese brands. The fact that Dongfeng is one of the largest shareholders of PSA yet their JV is the worst performing in China, no one can be happy. A lot is at stake for PSA in China, the least of which is Opel.

For GM, bidding adieu to Opel is unlikely to affect its operations in China as far as Buick is concerned. Buick has virtually become a 「local」 brand with GM』s PATAC JV now taking a lead role in the design and development of many of its new generation of models for both the China and U.S. markets. Irene Shen, PR Director of GM China, told CBU/CAR that 「Buick will continue to be fully supported by GM』s global engineering and technology resources.」 GM probably will not care too much if and when Opel ever comes back to China.

The Opel deal simply means more for PSA than it is for GM, as far as China is concerned.

The original version of this editorial appeared in the April 2017 issue of China Automotive Review (Vol. 12, No. 4), our monthly tabloid English magazine exclusively focused on the Chinese auto industry.